The Evolution of Bitcoin’s Price

Bitcoin is a revolutionary digital currency that has not only changed the financial landscape but has also gathered the emotions of millions of users worldwide. The growth of Bitcoin from its initial stages to prominence is nothing less than astonishment. 

Bitcoin has experienced several cycles with new heights and also experienced extreme lows. Thus, we are going to have a detailed overview of the roller coaster ride of Bitcoin that it has experienced from 2009 to 2024.

Factors Affecting the Price of Bitcoin

There are certain factors that determines the value of Bitcoin. They are as follows.

1.Supply and Demand

The fundamentals of supply and demand are crucial for determining the value of Bitcoin. Since the supply of Bitcoin is limited to 21 Million Coins, fluctuations in demand can lead to price volatility. Factors like adoption rates, investor interests, and macroeconomic factors determine demand. Changes in mining difficulty affect the new supply rate entering the market.

2.Halving Events

The supply issuance of Bitcoin is programmed to undergo halving events approximately every four years. It reduces the rate at which the new coins are generated. These halving events of Bitcoin bring in scarcity and affect the mining process of significant metals like gold. Historically, Halving events have observed price rallies due to the anticipation of increased scarcity and reduced supply growth.

3.Competition from Other Cryptocurrencies

There are a host of alternative cryptocurrencies that gives a competition to Bitcoin. The growth of the new blockchain projects that offers different features and use cases can divert the attention of an investor and the capital away from Bitcoin.

4.Institutional Adoption

The introduction of new financial products and investment vehicles related to Bitcoin, like exchange-traded funds, institutional-grade custody solutions, or future contracts, can impact its price dynamics. These products provide an opportunity for traditional investors to gain exposure to Bitcoin without having to own the underlying asset.

Early Years of Bitcoin: 2009 to 2012

The growth of Bitcoin (BTC) in the early years were very slow. The early years were characterised by very little knowledge and infrastructure. There were a few Bitcoin hobbyist who used to buy and sell the digital currency.

The first real world transaction of the crypto took place in the Bitcoin forum in 2010. A Florida native named Laszlo Hanyecz enquired whether anyone would buy him two pizzas for 10,000 Bitcoins. 

Those pizzas now are the most expensive pizzas ordered to date. Today, those Bitcoins are worth nearly $567,836,599

Bitcoin was not even worth a dollar until February 2011. And it was then that’s where the magic began. The price of the cryptocurrency hiked more than 30 times by June 2011, reaching a value of $30. But this spike did not last long, and it significantly dropped to around $4.70. 

In October 2011, Bitcoin’s first competitor, Litecoin, was introduced. The introduction of Litecoin spelled some doubt in the community, with a 90% drawdown testing resolve. Despite a slight rebound, 2012 was also uneventful for Bitcoin, which closed the year at a value of around $13.50.

Bitcoin’s Growth: 2013 to 2017

The price trajectory of Bitcoin began to change in 2013. By the end of 2014, the crypto exchanges started handling 70% of Bitcoin transactions and started gathering more users, making the digital currency more accessible to customers.

At the start of 2013, the price of Bitcoin was $13. In the same year, by November, the price of Bitcoin skyrocketed to $1000. However, the success of the currency waned in the following year when Mt. Gox, the crypto exchange faced security breaches where hackers stole $60 Million. Mt.Gox shut down subsequently and the price of Bitcoin again fell down to $300 by the end of the year.

Between 2015 and 2016, Bitcoin slowly marched along, making the price action muted. At the close of 2016, the price of Bitcoin was around $1000. The following year, more investors poured into the asset as the media coverage drew the average retail customer. BTC broke through $1000 in early 2017 and $2000 in May. The coin significantly doubled itself in August 2017 and reached the mark of $4000. 

This was the time when Bitcoin begun to win over the doubters. Futures contracts started trading on CME and many were feeling that Bitcoin was slowly growing into a legitimate financial asset class. The “fear of missing out” took hold and more investors started buying this asset. Bitcoin’s price rose to $10,000 in November 2021 before nearly doubling in the following month.

Recovery of Bitcoin: 2018 to 2021

Stepping on to 2018, the downtrend of Bitcoin didn’t slowdown. BTC’s price collapsed and it closed on below $4000. The digital currency closed on the year 2019 at a price of around $7000. With consistent downtrend and two years of inactivity, people thought that BTC had failed to make its place in the main marketstream.

Then came covid and the stock markets dropped violently in mid March 2020. And BTC was not an exception. Its price also fell down and came below $4000 within 72 hours. Some believed that this would be Bitcoin’s final nail in the coffin.

But those guesses were very wrong. As the Federal Reserves responded to the pandemic situation by printing money for fiscal stimulus, the price of the assets rose sharply. The tech and growth stocks showed significant rise but Bitcoin’s rise was the talk of the town. 

After halving to less than $4000 at the start of the pandemic, its price rose to $10000 in May 2020. But its actual boom came in the final quarter of 2020 when it breached its mark of $15,000 and reached $20000 in December 2020. The currency ended the year at $29000 with a market capital of $539 Billion.

As the Federal Reserve kept printing money and more retail investors dived into the market, the price of the assets continued to rise. BTC hit $40000 within a week of 2021, $50,000 in February 2021, and $60,000 in March 2021. But suddenly, the prices dropped to below $32000 before rising to an all-time high of close to $69000 in November 2021.

Crypto Winter: 2022

Since November 2021, BTC has struggled to compete with the rest of the market. With the end of money printing, the market was also hit by inflation. The Federal Reserve has been increasing interest rates since early 2022. Higher rates led to higher borrowing costs, reduced investments, and a general reduction in the economy’s demand.

Bitcoin has been a freefall henceforth and through the 2022 winters. The most damaging month was May when the collapse of stablecoin TerraUSD sparked a round of contagion in the crypto markets and pulling its price down from $39000 to $20000 in Mid June. Bitcoin’s bear market was further exacerbated by the fall of FTX, which led to extreme negative sentiment and fear, driving the price of Bitcoin down to $16,000.

Bitcoin’s Recovery: 2023

The BTC market witnessed a strong recovery in 2023 after facing a downside due to global macroeconomic situations and inflation data. This year turned out to be uncontrollable for Bitcoin. BTC was trading at a low value of $16000 in January, and suddenly, its price peaked at $31000 in July, with a market cap of around $607 Billion.

The stubborn inflation in countries like the UK and USA also led Bitcoin’s price to fall below $26000. However, in the second half of the year, BTC walked through the stairs of recovery. In July 2023, the price reached around $30500 but continued recovering through October, trading at around $34000. At the end of the year, BTC was trading at $42000 with a market cap of $838.58 Billion.

Surpassing All Time High: 2024

It was in July 8 2024 when BTC marked their highest buying activity and the cryptocurrency traded over $70000. But, the next day, its prices fell down to around $57000 with a market cap of $1.13 Trillion. The price of the cryptocurrency fell by more than 20% after marking its all time high of $73750. 

Bitcoin halving was completed in April 2024. Later, BTC followed a downtrend and fell below $60000 but recovered back to $70000 within a few days after the SEC’s approval of several Ethereum Spot ETFs in May 2024. At the beginning of 2024, BTC traded at around $43000 with a market cap of $915 Billion. 

BTC set a new record of $73750 soon after, but it also fell to $64000, with a market cap of $1.2 Trillion. As of August 5, 2024, its present valuation is around $54000 as of August 8th 2024. Check live Bitcoin price in INR.

Conclusion

The price history of Bitcoin from 2009 to 2024 defines its volatile journey from a niche digital asset to a mainstream asset class. Understanding the past fluctuations of the digital asset helps investors gauge market trends and anticipate the future movements. Despite the ups and downs of the digital currency, the long term trajectory of Bitcoin underscores its growing significance in the financial world.

Mudrex is a trusted trading platform for Bitcoin. Investors can download the App from the Play Store or App Store and start investing in Bitcoin immediately.

FAQ

1.What was Bitcoin price in 2009 in India?

The price of 1 Bitcoin at its beginning in 2009 was at 2.85 INR

2.Can I buy Bitcoin for 1000 Rupees?

Yes, you can buy Bitcoin for 100 Indian Rupees on Mudrex.

3. Is Investing in BTC legal in India?

Cryptocurrency is not accepted as a payment medium in India. However, investing and trading Bitcoin is completely legal in India.